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Old 11-22-2014, 08:50 PM   #41
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Nords,

Has this really been the case with you? I find that my costs (property taxes, energy, groceries) rise more than the small (but still very welcomed!) annual increases to my pension.
+1. Especially since I retired in 2010, the annual COLA has been pretty minimal - definitely not enough to cover my increased costs for the things you mention, and more. But hey, it's still better than no COLA.
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Old 11-22-2014, 09:17 PM   #42
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definitely not enough to cover my increased costs for the things you mention, and more. But hey, it's still better than no COLA.
Definitely. When people accuse me of having an "inflation adjusted pension" I tell them it's not. They just throw in a little something to keep me in the game. But it's not "inflation adjusted". In fact, as far as the military retirees go, we just went 2 years in a row when we dot NO raise: 2008/2009/(maybe 2010?), altho post 2008 inflation was
really low.

And didn't they start giving active duty, fed civil service, and mil and civilian retirees different raises back when Reagan was pres?
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Old 11-23-2014, 07:58 AM   #43
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Does anyone have any thoughts on how safe VA disability compensation is in the present environment?

Good question. I can foresee in some future day (who knows how long) everything will be on the table.
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Old 11-23-2014, 08:00 AM   #44
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If you take a look at my post #30, you can see that over the long run it works out well.
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Old 11-23-2014, 08:30 AM   #45
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Does anyone have any thoughts on how safe VA disability compensation is in the present environment?
This is like asking what the stock market returns will be over the next 30 years. I do think that VA disability compensation are pretty safe but COLAs probably won't totally keep up with your true inflation rate.

My cynical bent makes me think all government pensions (military and otherwise) will be nickle and dimed with little "adjustments" but not enough to let people to believe the system has been totally gutted. That's been the history of them during my lifetime.

I don't think it wise to totally depend on one aspect of your retirement plan to determine success or failure. Nobody knows what our government will do to supposedly "untouchable" entitlements. Nobody knows the future of stock market returns, bond yields or inflation rate. That's why I think it smart to be diversified even if a large part of your income is from a government payment.
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Old 11-23-2014, 09:43 AM   #46
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There is sentiment among some Congress members to return to the old system where tax exempt VA disability pay resulted in an offset of retired pay. Veterans Tripple Dipping on Retirement and Disability Benefits


The link below leads to a CBO study that recommends a return to the previous compensation system.

"Eliminate Concurrent Receipt of Retirement Pay and Disability Compensation for Disabled Veterans" https://www.cbo.gov/budget-options/2013/44744
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Old 11-23-2014, 10:16 AM   #47
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There is sentiment among some Congress members to return to the old system where tax exempt VA disability pay resulted in an offset of retired pay.
For many (most?) of us, there's nothing to go back to.
My military retired pay has always been offset by my VA disability pay.
The only benefit to me is that the disability pay is not taxable, so it just amounts to a few bucks a year.
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Old 11-23-2014, 10:34 AM   #48
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I think we are all in a similar boat (civilians, former military, public sector employees, and private sector employees). As long as the US economy rolls along nobody should expect huge cuts (pensions, 401K/IRA changes, SS, Medicare, Tricare). A great depression much more significant than the past great recession and all bets are off. Nobody is going to be defending military pension rights if their SS gets cut 50%.
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Old 11-23-2014, 10:55 AM   #49
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For many (most?) of us, there's nothing to go back to.
My military retired pay has always been offset by my VA disability pay.
The only benefit to me is that the disability pay is not taxable, so it just amounts to a few bucks a year.
Concurrent Retirement and Disability Pay (CRDP) allows military retirees to receive both military retired pay and Veterans Affairs (VA) compensation. This was prohibited until the CRDP program began on January 1, 2004. A retiree with 50% or greater rated disability now receives full retirement pay AND full tax free VA disability pay. There is no offset or decrease in retirement pay.

Concurrent Retirement Disability Pay
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Old 11-23-2014, 11:25 AM   #50
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Nords,
Has this really been the case with you? I find that my costs (property taxes, energy, groceries) rise more than the small (but still very welcomed!) annual increases to my pension.
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+1. Especially since I retired in 2010, the annual COLA has been pretty minimal - definitely not enough to cover my increased costs for the things you mention, and more. But hey, it's still better than no COLA.
I'm only 12 years into it, but the COLA has risen faster than our spending. By January my pension will have risen just under 30%, which implies a 12-year CPI of about 2.2%/year.

Part of that is our relentless optimization of our expenses. For example, we refinanced our home's mortgage down to 3.625% (fixed) and it still has another 26 years left. Our photovoltaic array has paid for itself, and our electric bill is down to $25/month (weather dependent) instead of over $200/month. Vacation/travel spending has gone up, but the daily average has dropped considerably. We're not sacrificing or cutting back or adjusting our hedonic treadmill-- we're just spending the money where we care the most.

Remember the threadswhere we reported our annual spending?
How much did you spend in 2010?
The federal government skipped a couple of COLAs during those years, but my pension still went up faster than our overall spending... which included getting a teen out of the house.

It's not all rainbows-- surf wax used to be $1.29 a patty but lately I haven't found anything less than $1.50. However I'm not at the point of buying a 50-pound block of paraffin and making my own.

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Does anyone have any thoughts on how safe VA disability compensation is in the present environment?
Google "#KeepYourPromise" and check the sentiment...

But seriously, the last thing the military (or the elected officials) can afford to do now is to cut back on VA disability compensation. The annual COLA for this payment still has to be authorized separately by Congress (instead of being part of the official CPI calculation) but the military advocacy groups are campaigning to have this included in the other federal automated COLA boosts.

Although it's a pendulum swing, over the decade the pendulum has been swinging in the favor of veterans-- look at CRSC and CRDP. Otherwise the VA can't even do the compensation process right, let alone figure out how to cut down the benefits payments. There's far more to be saved by fixing the VA than by taking money out of a veteran's pocket.

As I mentioned in another post, Tricare Prime is probably the most vulnerable of the military programs. Even the successor program (whatever it is) still be significantly cheaper than civilian health insurance.

I like the sound bite that's been going around the military blogs lately: "If you can't afford the costs, then don't go to war."

** Side note for the admins**
When I "Search entire post" for the phrase "How much did you spend" posted by me during "any date", it times out and generates a database error. When I run the search again and limit it to the title of the post, I get the thread I was looking for.

Either the database is too big, or it can't handle a poster with 26,000+ posts, or it can't search back 12+ years. I think this is more of a problem for the vBulletin coders or the website host's server parameters, not your database. But it would certainly be nice to have a search run longer before the server cuts it off.
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Old 11-23-2014, 11:33 AM   #51
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A retiree with 50% or greater rated disability now receives full retirement pay AND full tax free VA disability pay. There is no offset or decrease in retirement pay.
True. And for those with greater disability, I'm strongly in favor.
But I much prefer my lower disability rating and the offset.
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Old 11-23-2014, 11:58 AM   #52
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Not sure how "solvent" it is or will be but it has been fine for 35.5 years so far (VA too). I suspect it will last longer than I will.
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Old 11-24-2014, 09:02 PM   #53
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** Side note for the admins**
When I "Search entire post" for the phrase "How much did you spend" posted by me during "any date", it times out and generates a database error. When I run the search again and limit it to the title of the post, I get the thread I was looking for.

Either the database is too big, or it can't handle a poster with 26,000+ posts, or it can't search back 12+ years. I think this is more of a problem for the vBulletin coders or the website host's server parameters, not your database. But it would certainly be nice to have a search run longer before the server cuts it off.
Nords, I did "Search entire post" for the phrase "How much did you spend", for username Nords, and got 1599 posts returned almost immediately. http://www.early-retirement.org/foru...archid=4028314 I wonder if perhaps it was a temporary problem?
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Old 11-25-2014, 02:35 AM   #54
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I think the COLA is the key to why military retirement has been such a good deal.
Mine began in 1989, and my retired pay has increased by a cumulative 92.7% since then. The CPI inflation has increased by 92.06% in the same period, so I'm holding my own very nicely.

But I don't see this lasting forever.
The trick is to live somewhere, where the COL is considerably below the national average that they base the COLA's on.
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Old 11-25-2014, 02:50 AM   #55
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They may tinker with COLA's and healthcare, but as far as the pensions going away for those already retired, no. If that happens the end time is near, and evaporation of pension income will only be one facet of day-to-day survival concerns.
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Old 11-30-2014, 03:52 PM   #56
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They may tinker with COLA's and healthcare, but as far as the pensions going away for those already retired, no.
I agree.

About the nickel and dime part...Click on Item #8. (Below)
Item #7 also affects what ChainsBeGone pointed out. (Below)
You may also want to look at some of the other items on the list, by scrolling down, too. It has to be approved, though. And I don't want to say the sky is falling.
This is the 2014 version.
Summary Table of Options | Congressional Budget Office
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Old 11-30-2014, 05:15 PM   #57
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Boy why not just one line that reads - Eliminate all veterans benefits for Vietnam era vets.
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Old 12-03-2014, 11:41 AM   #58
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I'm coming late to this interesting thread, but feel right in the middle of it. I retired as a Colonel with 26 years in 2001 (3 months before 9/11). I went to work in the defense industry and will retire completely next month (January, 2015) at age 61. Since 2001 I have been investing my entire retirement pay equivalent - plus a little - rode through the 2008 downturn, and believe I'm ready to do this. I've worked hard on my retirement budget. My military retirement pay plus a 2% annual withdrawal from assets will meet my budget figure. That's only for 5 years until I hit 66 and start drawing Social Security, which will be roughly the equivalent of my 2% annual withdrawal. I have continually checked, rechecked and run numerous calculators and everything comes up positive. Military retirement is the centerpiece of this plan, along with (relatively) inexpensive Tricare/Tricare for Life (after 65) health care. Yes, I'm confident the military pension will continue, with possibly small to non-existent COLAs, depending who's running the government. I'm thankful to have it . . .
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Old 12-03-2014, 12:11 PM   #59
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As a non military type - my non cola pension comes from a defense contractor I avoid any reading of the history of French and British military pensions of times past. A lot of the trouble was due to past currency devaluations (especially for ex pats) and I think in one case(British? - a PBS tv program) a requirement to relocate home to spend the money.

heh heh heh - hopefully we here in the good ol USA understand 'fiduciary'.
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Old 12-03-2014, 04:45 PM   #60
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I'm coming late to this interesting thread, but feel right in the middle of it. I retired as a Colonel with 26 years in 2001 (3 months before 9/11). I went to work in the defense industry and will retire completely next month (January, 2015) at age 61. Since 2001 I have been investing my entire retirement pay equivalent - plus a little - rode through the 2008 downturn, and believe I'm ready to do this. I've worked hard on my retirement budget. My military retirement pay plus a 2% annual withdrawal from assets will meet my budget figure. That's only for 5 years until I hit 66 and start drawing Social Security, which will be roughly the equivalent of my 2% annual withdrawal. I have continually checked, rechecked and run numerous calculators and everything comes up positive. Military retirement is the centerpiece of this plan, along with (relatively) inexpensive Tricare/Tricare for Life (after 65) health care. Yes, I'm confident the military pension will continue, with possibly small to non-existent COLAs, depending who's running the government. I'm thankful to have it . . .
Don't know what your expenses are but I should think you will be more than fine. I retired at 58 with O-6 pension/28.5 years. Worked as a BB for 6 years and saved a lot but really didn't like it so retired for good. Finances have been pretty easy in retirement. Like you, military retirement is the centerpiece but I feel a lot more comfortable with a nice cushion in case the military retired benefits are reduced (relatively speaking) in the future. Good luck.
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